Entrepreneurs, firms' success, and failure factors are a subject of extensive research over many years. It is necessary for entrepreneurs and organizations to understand both the internal and external motivational factors that may lead to success or failure of a business venture. A business in the startup level encounters various barriers and challenges. It is the task of the entrepreneur or the managing board to decide on the right moves for the success of the business. This study will use an example of two companies Siebel and eBay to analyze the various factors that determine the success or failure of a startup company.

Siebel and eBay are an example of two companies that show contrasting characteristics of handling the market area for their products and services. Siebel and eBay both ventured into their lines of business successfully, but Siebel developed various problems on its way up and finally absorbed by another company. Various factors led to the collapse of Siebel and success of eBay. The Siebel software designing company entered the market for its products when there were few competitors. Their products had a competitive advantage in terms of efficiency compared to others. This gave Siebel an opportunity to dominate the market and expand at a fast rate. Key factors that led to the failure of Siebel include an introduction of a product upgrade in the year 2001 that was difficult and complicated to use. According to Kerstetter (2003), Siebel introduction of this product reduced its reputation as many clients turned into simple competitors' products.

Although Siebel Company had a successful startup, they failed to maintain their standards and focus on customer satisfaction. The reputation of the company experienced negative publicity especially on customer satisfaction records. On the other hand, eBay had a humble startup but successfully ventured into the market for its services. Various factors led to the success of eBay Company. The company struggled to distinguish itself from its competitors in the market place by creating services that did not exist before. As an auction company that uses the internet, the firm provided education on how their systems operate in all parts of the country. This not only provided education on how to sell products over eBay Company but also provided awareness about the existence of the company and the availability of such services. The success of eBay has also accredited to a strong executive team that worked like servants to their clients. The company aims at customer satisfaction and holds frequent meetings and conferences with both sellers and buyers to get their views about the services of the firm.

In a move to ensure customer satisfaction and revenue maximization, eBay hired many virtual cops to check and prevent the auction system from fraudsters. A startup company must follow the traits of the eBay auction company. A company must understand the startup costs for its line of business. The startup costs for a new company explainable by designing a suitable business plan. A business plan helps identify problems such as the costs of starting the business before implementing the plans. A suitable business plan will help a startup company compare results as the business proceeds from paper to reality (Larson, n.d.). A startup company must have the capacity to recruit and maintain customers. In the case of Siebel Company, failure to maintain customers through satisfaction led to the collapse of the company. The management team of Siebel was over optimistic and confident in retaining their customers but failed to control the firm's reputation. A startup company must focus its attention to acquiring and maintaining its customers in order to penetrate the market for its products and services

A startup company must strive to employ the right people. A qualified and experienced workforce is necessary for a startup company in order to make the business successful. A strong workforce contributes a bigger percentage in the success of a company. A strong management team can successfully arrange all other things. A startup company must have a strategic focus in order to venture successfully in its line of business. The entrepreneur or the management team should be able to focus the organization's resources on the opportunities available and which can create a competitive advantage. Failure in a startup business may occur if available resources are not directed in the main purposes of…[continue]

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